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The cost of producing radios in Country Q is ten percent [#permalink]
03 Feb 2005, 19:05

00:00

A

B

C

D

E

Difficulty:

(N/A)

Question Stats:

0%(00:00) correct
0%(00:00) wrong based on 1 sessions

The cost of producing radios in Country Q is ten percent less than the cost of producing radios in Country Y. Even after transportation fees and tariff charges are added, it is still cheaper for a company to import radios from Country Q to Country Y than to produce radios in Country Y. The statements above, if true, best support which of the following assertions?

A. Labor costs in Country Q are ten percent below those in Country Y.
B. Importing radios from Country Q to Country Y will eliminate ten percent of the manufacturing jobs in Country Y.
C. The tariff on a radio imported from Country Q to Country Y is less than ten percent of the cost of manufacturing the radio in Country Y.
D. The fee for transporting a radio from Country Q to Country Y is more than ten percent of the cost of manufacturing the radio in Country Q.
E. It takes ten percent less time to manufacture a radio in Country Q than it does in Country Y.

The cost of producing radios in Country Q is ten percent less than the cost of producing radios in Country Y. Even after transportation fees and tariff charges are added, it is still cheaper for a company to import radios from Country Q to Country Y than to produce radios in Country Y. The statements above, if true, best support which of the following assertions?

A. Labor costs in Country Q are ten percent below those in Country Y.B. Importing radios from Country Q to Country Y will eliminate ten percent of the manufacturing jobs in Country Y.C. The tariff on a radio imported from Country Q to Country Y is less than ten percent of the cost of manufacturing the radio in Country Y.D. The fee for transporting a radio from Country Q to Country Y is more than ten percent of the cost of manufacturing the radio in Country Q.E. It takes ten percent less time to manufacture a radio in Country Q than it does in Country Y.

Labour costs being low in Q probably explains why costs are lower when manufactured in Q - but it does not result from the stem.
Reducing manufacturing jobs in Y do not have an influence on the charges of importing from Q.
E is probably a reason why the cost of manufacturing is lower but does not result from the statements in the stem.

It is clear from D total cost for importing from Q will rise to above cost of manufacturing in Y if D were true - hence it is not supported by the statements in the stem.